Bethesda has released a brutal announcement on the development status of Prey 2, saying that development by developer Human Head has not "progressed satisfactorily". Ouch.

Quote:

Development of Prey 2 has not been cancelled but the game will not be released in 2012 as planned. The delay is due to the fact that game development has not progressed satisfactorily this past year, and the game does not currently meet our quality standards. Prey 2 has shown great promise and we regret disappointing our fans. We have made a substantial investment in game development to deliver the experience fans want. We are determined only to release the AAA game that fans rightfully expect, and are unwilling to compromise our quality standards to meet a release schedule.

Last month, I posted the rumbling rumours of the game being canned. I think that the possibility that this unique and amazing looking game may never see retail is high.
It's disappointing that Bathesda is talking so negatively about the game, though. They need to step-up and proclaim from the rooftops that this game will hit shelves as soon as it's ready, not bitch about the quality.
I'm sure Human Head is in panic-mode right now.

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Something weird going on with all the Facebook stuff about Rune 2 going up. Maybe HH spent some resources doing a R2 demo or something? My impression is that HH completes stuff to an above average visual quality, maybe this takes time though?

Anyhoo, I'm not sure you could say that Rune 1 nor Prey were "low quality" like kwolf suggests. Do I remember those games wrong?

"game development has not progressed satisfactorily this past year, and the game does not currently meet our quality standards"
That's both behind schedule and buggier than it should be at this point in the schedule.
Bethesda handled their statement poorly. Comments like those should appear in a postmortem, not presented to (scare off) potential customers before a product ships.

Smells like an ulterior motive. Bethesda putting out a statement like that feels as if they're trying to trigger some legal clause in the development contract that gets them out of paying Human Head any money. Like shame them into quitting the project, or force an exodus of employees, or scare off any other investors to collapse the company, then maybe get them to default and you're off the hook?